Justices Focus on Future of Individual, Not Class, Claims

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By Perry Cooper

Oct. 14 — The U.S. Supreme Court seemed fixated at oral argument in a closely watched class suit on the question of whether an individual plaintiff can continue with his individual claims after he has rejected a defendant's offer of all he asked for.

That left the justices little time to consider the larger repercussions of mooting the individual's claims for an uncertified class action. But some of the court's conservatives questioned whether the plaintiff could adequately represent a class after he has received compete relief.

The case, which involves U.S. Navy recruitment text messages that allegedly violated the Telephone Consumer Protection Act, 47 U.S.C. §227, essentially asks the justices to decide whether a defendant can defeat a class action by “picking off” the named plaintiff with a judgment offer.

Return to Genesis Healthcare

The court's liberal justices picked up where they left off in a 2013 dissent to a decision involving a collective action under the Fair Labor Standards Act, Genesis Healthcare Corp. v. Symczyk, 81 U.S.L.W. 4229, 2013 BL 101434 (U.S. April 16, 2013)(Kagan, J., dissenting).

The majority in that case assumed, without deciding, that an unaccepted offer that completely satisfied a claim would moot an individual plaintiff's claim. The majority then decided that when an individual claim is moot, a collective action claim brought under the FLSA also is moot.

But Justice Elena Kagan, joined by three justices in dissent, said that an unaccepted offer of judgment can't moot a plaintiff's individual claims because that offer is a legal nullity with no operative effect.

‘Non Sequitur' on Mootness

Gregory G. Garre argued for Campbell-Ewald Co., the government contractor responsible for the allegedly improper texts.

Garre, of Latham & Watkins LLP in Washington, said that Campbell-Ewald's offer to pay plaintiff Jose Gomez $1,503 for his claim—an amount that more than covered the statutory damages he could recover individually under the TCPA—was a complete offer.

Even though Gomez's complaint requested them, the offer didn't need to include attorneys' fees, declaratory relief or class damages because he's not entitled to them under the statute, Garre argued.

But Kagan grilled him on his conclusion that because Gomez received “everything” he's entitled to, the case is moot.

“And the ‘so the case is moot' seems to me to be a non sequitur,” she said. “Now, you might be completely right as to the ‘He's not entitled to attorneys' fees.' But that has to be adjudicated.”

Justice Sonia Sotomayor agreed. Plaintiffs are entitled to a determination of whether they can receive the relief they asked for, she said. “But they're entitled to have the court say it, not you.”

Ask for a Unicorn

“I am so confused by your argument,” Sotomayor told Garre later during the argument.

“You get to say on your own, unilaterally, ‘I offered you complete relief,'” she said. “You, without any judicial interpretation, intervention, get to moot the case on your terms.”

She got Garre to acknowledge that it is up to the court to decide when a complete offer has been made.

“That's all I needed for you to say,” she then quipped.

Garre said he doesn't feel sorry for plaintiffs who get everything they ask for.

But Kagan stressed that whether the defendant has offered the plaintiff complete relief is a contested question. “And the measure of complete relief has to be, at this stage, about what his complaint asks for,” she said.

“I suppose he could ask for the key to Fort Knox, right?” Justice Antonin Scalia asked.

“He could ask for a unicorn, Your Honor,” Garre added.

But Kagan brushed those jokes aside, saying if a request is clearly frivolous, the court can dismiss the case on the merits.

Adequacy Stumps Plaintiffs, U.S.

The larger issue of what happens to class claims when a judgment offer has been made wasn't really addressed until Chief Justice John G. Roberts Jr. brought up the question of whether a plaintiff who has received complete relief can still be a class representative.

The class action question was repeatedly brushed aside by Kagan and Sotomayor, who were more interested in getting to the bottom of the mootness issue on the plaintiff's individual claims.

Roberts put the question to Jonathan F. Mitchell, who argued for Gomez, and later Anthony A. Yang, assistant to the solicitor general, who argued for the government on behalf of Gomez.

Neither appeared to offer the justices satisfying answer.

Mitchell, a law professor at Stanford University, answered that the lead plaintiff would still have a financial interest in sharing the attorneys' fees with other class members, and in the incentive award he would recover if the suit ends in settlement.

When Roberts pressed Mitchell on whether the plaintiff could still be an adequate representative for class members who haven't gotten full relief, Mitchell said, “that might be something for a court to consider under Rule 23.”

One of the requirements for class certification under Federal Rule of Civil Procedure 23 is whether a class representative can adequately represent the members of the class and whether his claims are typical of class members.

But “the incentive award still gives him incentives to press for the fellow class members,” he said.

Yang answered Roberts' question in a similar way, saying it's something that “could be considered by the court in exercising its discretion under Rule 23.”

It's a hard question, he said, giving an answer that seemed to take the defendants' position. When a plaintiff says, “ ‘I'll just accept my money and drop the interests of the class,' ” you “wonder whether that plaintiff is actually a good adequate representative.”

Jonathan F. Mitchell of Stanford University in Stanford, Calif., argued for Gomez.

Gregory G. Garre of Latham & Watkins LLP in Washington argued for Campbell-Ewald.

Anthony A. Yang, assistant to the solicitor general, argued for the government.

To contact the reporter on this story: Perry Cooper in Washington at pcooper@bna.com

To contact the editor responsible for this story: Steven Patrick at spatrick@bna.com

The transcript is at http://src.bna.com/Ai.